Quarterly data on Intel sales M:==> 4

Farid Alizadeh:
($ millions) For Holt-Winters method
Quarter Sales Lt Tt St Ft Exponential the formulas are
Q1-86 280.05 280.05 different for the first
Q2-86 305.18 305.18 25.12 1 330.302 285.0788 cycle (bordered red)
and the rest of the
Q3-86 324.14 325.2772 23.891 0.996495 347.9443 292.8904 cycles.
Q4-86 355.64 350.463 24.14995 1.014778 380.1488 305.4408
Q1-87 394.53 378.5969 24.94676 1.042092 420.5298 323.2592
Q2-87 438.96 410.6261 26.36325 1.068992 467.1381 346.3986
Q3-87 501.13 450.1697 28.9993 1.008165 483.0814 377.3444
Q4-87 572.49 496.1654 32.39859 1.028682 543.7245 416.3732 H
Q1-88 635.81 544.8763 35.66104 1.054572 612.2181 460.2599
Q2-88 726.68 600.3865 39.63089 1.083129 693.2211 513.5445 10000
Q3-88 784.94 667.7303 45.17347 1.024902 730.6564 567.8234
Q4-88 727.34 711.735 44.93971 1.028007 777.8667 599.7267 9000
Q1-89 713.08 740.5763 41.72003 1.045402 817.8141 622.398
Q2-89 747.34 763.8331 38.02737 1.072656 860.1204 647.3858 8000
Q3-89 771.44 792.0273 36.06074 1.019812 844.4941 672.1962
Q4-89 894.97 836.5889 37.76092 1.032185 902.4909 716.752 7000
Q1-90 894.46 870.602 37.01135 1.043602 947.1869 752.293
Q2-90 968.30 906.6334 36.81536 1.072192 1011.558 795.4946 6000
Q3-90 1012.44 953.3134 38.78829 1.024033 1015.945 838.8839
Q4-90 1046.07 996.3727 39.6425 1.033955 1071.193 880.3221 5000
Q1-91 1132.78 1045.902 41.6199 1.047548 1139.232 930.8133
Q2-91 1252.69 1103.686 44.85265 1.078473 1238.668 995.1878 4000
Q3-91 1187.70 1150.797 45.30426 1.024837 1225.808 1033.691
Q4-91 1205.45 1190.053 44.09471 1.031853 1273.459 1068.042 3000
Q1-92 1241.29 1224.308 42.12676 1.04418 1322.386 1102.692
Q2-92 1319.69 1257.881 40.41608 1.07554 1396.371 1146.092 2000
Q3-92 1426.17 1316.959 44.14834 1.030646 1402.819 1202.107
Q4-92 1856.83 1448.788 61.68457 1.056832 1596.317 1333.052 1000
Q1-93 2023.56 1595.966 78.78326 1.066554 1786.211 1471.154
Q2-93 2129.56 1735.798 90.99295 1.090671 1992.427 1602.835 0
Q3-93 2239.85 1896.082 104.8512 1.045711 2092.399 1730.238 12/30/1899 1/19/1900
Q4-93 2389.03 2052.859 115.2363 1.067525 2314.496 1861.997
Q1-94 2660.00 2233.279 128.273 1.079006 2548.129 2021.597
Q2-94 2770.00 2397.186 135.3998 1.097156 2778.641 2171.278
Q3-94 2863.00 2573.638 143.6103 1.052384 2859.588 2309.622
Q4-94 3228.00 2778.562 155.8731 1.076948 3160.233 2493.298 Exp
Q1-95 3557.00 3006.858 170.3577 1.089402 3461.265 2706.038
Q2-95 3894.00 3251.608 185.2362 1.107196 3805.262 2943.631 10000.00
Q3-95 4171.00 3542.152 206.2977 1.064898 3991.719 3189.104
9000.00
Q4-95 4580.00 3849.312 226.4701 1.088235 4435.41 3467.284
Q1-96 4644.00 4113.204 233.9544 1.093366 4753.037 3702.627
8000.00
Q2-96 4621.00 4312.447 227.0123 1.103632 5009.891 3886.302
Q3-96 5142.00 4597.294 238.5791 1.070257 5175.627 4137.441 7000.00
Q4-96 6440.00 5052.266 281.8577 1.106879 5904.231 4597.953
Q1-97 6448.00 5446.775 304.388 1.102412 6340.15 4967.962 6000.00
Q2-97 5960.00 5681.001 290.3556 1.09818 6557.622 5166.37
Q3-97 6155.00 5927.276 281.5396 1.067073 6625.262 5364.096 5000.00
Q4-97 6507.00 6142.791 268.3345 1.10212 7065.832 5592.677
Q1-98 6001.00 6217.604 229.6303 1.088687 7019.019 5674.341 4000.00
Q2-98 5927.00 6237.21 187.6255 1.083388 6960.59 5724.873
3000.00

2000.00

1000.00

0.00
 6000.00

5000.00

4000.00

Q3-98 6731.00 6401.45 182.9483 1.065514 7015.769 5926.098 3000.00

Q4-98 7614.00 6649.219 195.9124 1.106418 7573.577 6263.679
Q1-99 7103.00 6780.98 183.0821 1.084567 7552.992 6431.543 2000.00
Q2-99 6746.00 6816.602 153.5902 1.074014 7486.081 6494.434
Q3-99 7328.00 6951.64 149.8797 1.064377 7558.692 6661.148 1000.00
Q4-99 8212.00 7165.646 162.7049 1.110379 8137.244 6971.318
Q1-00 7993.00 7336.633 164.3613 1.085057 8139.004 7175.654 0.00
Q2-00 8300.00 7546.4 173.4424 1.076598 8311.169 7400.524 12/30/1899 1/19/1900
Q3-00 8731.00 7816.458 192.7657 1.069639 8566.98 7666.619
Q4-00 8702.00 7974.773 185.8754 1.10846 9045.751 7873.695
Q1-01 6677.00 7759.237 105.5933 1.062603 8357.196 7634.356
 alpha 0.2
Change values of alpha, beta and gamma
beta 0.2 and see the effects. Also notice that in this
gamma 0.1 case MAD and MAPE results for Holt-
Holt-winters Exponential Winters method is far superior to simple
MAD 291.08422 652.74834 exponential smoothing
MAPE 8.18% 21.70%

Holt-Winters

Sales
Ft

0/1899 1/19/1900 2/8/1900 2/28/1900 3/20/1900

Exponential smoothing
00

00

00

00

00 Sales
00 Exponential

00

00

00

00

00
00 Sales
00 Exponential

00

00

00

00

00
/30/1899 1/19/1900 2/8/1900 2/28/1900 3/20/1900
Quarter Sales log sales) t Q1 Q2 Q3 Q4
Q1-86 280.05 2.44724178 1 1 0 0 0
Q2-86 305.18 2.484553222 2 0 1 0 0
Q3-86 324.14 2.510728607 3 0 0 1 0
Q4-86 355.64 2.551013043 4 0 0 0 1
Q1-87 394.53 2.596083335 5 1 0 0 0
Q2-87 438.96 2.642420989 6 0 1 0 0
Q3-87 501.13 2.699948669 7 0 0 1 0
Q4-87 572.49 2.757766387 8 0 0 0 1
Q1-88 635.81 2.803325304 9 1 0 0 0
Q2-88 726.68 2.861345 10 0 1 0 0
Q3-88 784.94 2.894835907 11 0 0 1 0
Q4-88 727.34 2.861737471 12 0 0 0 1
Q1-89 713.08 2.853140082 13 1 0 0 0
Q2-89 747.34 2.873516484 14 0 1 0 0
Q3-89 771.44 2.887301028 15 0 0 1 0
Q4-89 894.97 2.951810903 16 0 0 0 1
Q1-90 894.46 2.951559467 17 1 0 0 0
Q2-90 968.30 2.98601038 18 0 1 0 0
Q3-90 1012.44 3.005369724 19 0 0 1 0
Q4-90 1046.07 3.019562822 20 0 0 0 1
Q1-91 1132.78 3.054144806 21 1 0 0 0
Q2-91 1252.69 3.097842223 22 0 1 0 0
Q3-91 1187.70 3.074707853 23 0 0 1 0
Q4-91 1205.45 3.08114884 24 0 0 0 1
Q1-92 1241.29 3.093873605 25 1 0 0 0
Q2-92 1319.69 3.120472912 26 0 1 0 0
Q3-92 1426.17 3.154170383 27 0 0 1 0
Q4-92 1856.83 3.268772845 28 0 0 0 1
Q1-93 2023.56 3.306115871 29 1 0 0 0
Q2-93 2129.56 3.32828988 30 0 1 0 0
Q3-93 2239.85 3.350218547 31 0 0 1 0
Q4-93 2389.03 3.378222148 32 0 0 0 1
Q1-94 2660.00 3.424881637 33 1 0 0 0
Q2-94 2770.00 3.442479769 34 0 1 0 0
Q3-94 2863.00 3.456821348 35 0 0 1 0
Q4-94 3228.00 3.508933526 36 0 0 0 1
Q1-95 3557.00 3.551083865 37 1 0 0 0
Q2-95 3894.00 3.590395947 38 0 1 0 0
Q3-95 4171.00 3.62024019 39 0 0 1 0
Q4-95 4580.00 3.660865478 40 0 0 0 1
Q1-96 4644.00 3.666892211 41 1 0 0 0
Q2-96 4621.00 3.664735969 42 0 1 0 0
Q3-96 5142.00 3.711132072 43 0 0 1 0
Q4-96 6440.00 3.808885867 44 0 0 0 1
Q1-97 6448.00 3.809425029 45 1 0 0 0
Q2-97 5960.00 3.77524626 46 0 1 0 0
Q3-97 6155.00 3.789228057 47 0 0 1 0
Q4-97 6507.00 3.813380807 48 0 0 0 1
Q1-98 6001.00 3.778223627 49 1 0 0 0
Q2-98 5927.00 3.772834927 50 0 1 0 0
 Q3-98 6731.00 3.828079591 51 0 0 1 0
Q4-98 7614.00 3.881612872 52 0 0 0 1
Q1-99 7103.00 3.851441815 53 1 0 0 0
Q2-99 6746.00 3.829046337 54 0 1 0 0
Q3-99 7328.00 3.864985461 55 0 0 1 0
Q4-99 8212.00 3.914448941 56 0 0 0 1
Q1-00 7993.00 3.902709813 57 1 0 0 0
Q2-00 8300.00 3.919078092 58 0 1 0 0
Q3-00 8731.00 3.941063988 59 0 0 1 0
Q4-00 8702.00 3.939619079 60 0 0 0 1
Q1-01 6677.00 3.824581376 61 1 0 0 0

SUMMARY OUTPUT

Regression Statistics
Multiple R 0.98726162
R Square 0.9746855
Adjusted R S 0.97287732
Standard Erro 0.07563576
Observations 61

ANOVA
df SS MS F Significance F
Regression 4 12.33495579 3.08373895 539.042756 5.5718E-44
Residual 56 0.320363049 0.00572077
Total 60 12.65531884

Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0%
Intercept 2.54317157 0.026299497 96.7003868 5.2461E-64 2.49048738 2.59585576 2.49048738
t 0.02552127 0.000550461 46.3634776 2.3013E-46 0.02441856 0.02662397 0.02441856
Q1 -0.02716058 0.027188888 -0.99895872 0.32211178 -0.08162643 0.02730527 -0.08162643
Q2 -0.01625831 0.02764021 -0.58821231 0.55875469 -0.07162827 0.03911165 -0.07162827
Q3 -0.01507537 0.027623761 -0.5457394 0.58741254 -0.07041238 0.04026163 -0.07041238

RESIDUAL OUTPUT

Observation
Predicted log sales)Residuals
1 2.54153226 -0.09429048
2 2.57795579 -0.09340257
3 2.60466 -0.09393139
4 2.64525664 -0.09424359
5 2.64361732 -0.04753399
6 2.68004085 -0.03761987
7 2.70674506 -0.00679639
8 2.7473417 0.01042469
9 2.74570239 0.057622918
10 2.78212592 0.079219083
11 2.80883012 0.086005788
12 2.84942676 0.012310712
13 2.84778745 0.005352634
14 2.88421098 -0.01069449
15 2.91091518 -0.02361415
16 2.95151182 0.000299082
17 2.94987251 0.001686957
18 2.98629604 -0.00028566
19 3.01300024 -0.00763052
20 3.05359688 -0.03403406
21 3.05195757 0.002187234
22 3.0883811 0.00946112
23 3.1150853 -0.04037745
24 3.15568194 -0.0745331
25 3.15404263 -0.06016903
26 3.19046616 -0.06999325
27 3.21717037 -0.06299998
28 3.25776701 0.011005838
29 3.2561277 0.049988176
30 3.29255123 0.035738654
31 3.31925543 0.030963119
32 3.35985207 0.01837008
33 3.35821276 0.066668879
34 3.39463629 0.047843481
35 3.42134049 0.035480858
36 3.46193713 0.046996396
37 3.46029782 0.090786046
38 3.49672135 0.093674597
39 3.52342555 0.096814638
40 3.56402219 0.096843286
41 3.56238288 0.10450933
42 3.59880641 0.065929557
43 3.62551061 0.085621458
44 3.66610725 0.142778613
45 3.66446794 0.144957086
46 3.70089147 0.074354786
47 3.72759568 0.061632381
48 3.76819232 0.045188491
49 3.766553 0.011670622
50 3.80297654 -0.03014161
51 3.82968074 -0.00160115
52 3.87027738 0.011335494
53 3.86863807 -0.01719625
54 3.9050616 -0.07601526
55 3.9317658 -0.06678034
56 3.97236244 -0.0579135
57 3.97072313 -0.06801332
58 4.00714666 -0.08806857
59 4.03385086 -0.09278687
60 4.0744475 -0.13482842
61 4.07280819 -0.24822681
 Farid Alizadeh:
predicted Here we assume that sales are
value of predicted exponential growth with respect to
Log(sales) sales time. Thus we take log (base 10
2.5415322623 347.962356 here, but any other bases will do) MAD 557.9331
2.5779557929 378.404065 We then create four columns MAPE 13.37%
2.6046599952 402.401875 representing the dummy that is 0-
1) variables for each quarter. Then
2.6452566355 441.83146 we use multiple regression with log
2.6436173242 440.166842 sales) as dependent variable, and
2.6800408548 478.67512 time and three of the four dummy
2.7067450571 509.031967 variables (in this case Q1-Q3) as
2.7473416974 558.909765 independent variables. The
2.7457023861 556.804051 regression produces coefficients of
2.7821259167 605.516409 the equation we then use these
variables to get predicted values of
2.808830119 643.917338 log sales) and then raise 10 to
2.8494267593 707.011958 these values to get the predicted
2.847787448 704.348263 sales.
2.8842109785 765.968621
2.9109151808 814.545185
2.9515118212 894.358875
2.9498725098 890.989344
2.9862960404 968.938116
3.0130002427 1030.3867 Sales
3.053596883 1131.34974
3.0519575717 1127.08734 14000
3.0883811023 1225.6913
3.1150853046 1303.42277
3.1556819449 1431.13942 12000
3.1540426336 1425.74755
3.1904661642 1550.47998
10000
3.2171703665 1648.80906
3.2577670068 1810.36859
3.2561276955 1803.54796 8000 sales
3.292551226 1961.33251 predicted sale
3.3192554283 2085.71723
3.3598520687 2290.08746 6000
3.3582127573 2281.45947
3.3946362879 2481.05441
3.4213404902 2638.3991 4000
3.4619371305 2896.92419
3.4602978192 2886.00992
2000
3.4967213498 3138.49434
3.5234255521 3337.53287
3.5640221924 3664.563 0
3.5623828811 3650.75662 0 10 20 30 40 50 60 70
3.5988064117 3970.14539
3.625510614 4221.92597
3.6661072543 4635.61388
3.6644679429 4618.14902 Log of sales
3.7008914735 5022.17074
3.7275956758 5340.66916 4.5
3.7681923162 5863.97778
3.7665530048 5841.88502 4
3.8029765354 6352.96606
3.5

Log(sales)
2.5
predicted Log(sales
 Log of sales
4.5

3.8296807377 6755.8615 3.5

3.870277378 7417.83857
3.8686380667 7389.89158 3
3.9050615973 8036.40097
3.9317657996 8546.05728 Log(sales)
2.5
3.9723624399 9383.44775 predicted Log(sales
3.9707231286 9348.09524
2
4.0071466592 10165.9193
4.0338508614 10810.6265
4.0744475018 11869.9121 1.5
4.0728081904 11825.1917
1

0.5

0
12/30/1899 1/19/1900 2/8/1900 2/28/1900 3/20/1900

Upper 95.0%
2.5958557628
0.0266239697
0.0273052747
0.0391116451
0.0402616312
 sales
predicted sales

60 70

Log(sales)
predicted Log(sales)
 Log(sales)
predicted Log(sales)

0/1900